Wednesday 15th of December 2010
Brits who turn to store cards to fund their spending before the end of the year may start asking individual voluntary arrangement (IVA) questions if they find they cannot cover their repayments at the start of 2011.
Joanna Parsley, associate director of Credit Action, said the finance options are tempting to a large number of people as there is more pressure to spend money at this time of year.
"If you need to borrow this year … it's essential to do it as cheaply as possible," she stated, adding people signing up for high street plastic deals should check the small print.
Ms Parsley observed that while the finance products can have some benefits, they are likely to charge rates of interest between 20 and 30 per cent.
This could lead to arrears building up if a customer cannot meet the bill payments, which may result in them asking IVA questions.
According to Credit Action's latest debt statistics, £740 million in credit card debt was written off in the twelve months to the end of the third quarter of the year.
By Rachel Powell
